Incorporating (Some) Unilateral Free Trade into the Trading System

That's the title of a short essay of mine in the Virginia Journal of International Law's online edition. Here's the main proposal:

... I thus propose an approach that I call "unilateral
reciprocal binding trade liberalization." The basic idea is that unilateral liberalization by one member
would lead to reciprocal liberalization from other members. The initial
liberalization is undertaken unilaterally, and would then be part of the
country's binding free trade promises. Other countries would then be required
to reciprocate with new free trade commitments of their own. In other words,
WTO Members would agree to cut their tariffs and other designated trade restrictions
whenever another Member makes unilateral cuts.

I will briefly sketch out the contours of this approach
here, but clearly further development is required if this proposal were to be
put into practice. In order to administer this system, a neutral review
mechanism, along the lines of the WTO's Trade Policy Review Mechanism, would be
set up to evaluate the extent of the unilateral cuts and quantify the matching
cuts that would be required in response. This mechanism would review existing
protection and government support, in order to determine the corresponding
liberalization to be offered in response to the initial liberalization. The
mechanism would be overseen by a group of outside (i.e., non-governmental)
experts.

In terms of the specific responding cuts to be made, only
those who benefit from the unilateral cuts would be required to make their own
cuts. When a government makes its initial unilateral cuts, it could request
which cuts it would like other governments to make in response. Ultimately, however,
the corresponding liberalization is each government’s choice. Its decision
would be made in conjunction with the neutral oversight mechanism.

More generally, I don't expect governments to adopt this approach any time soon, or ever for that matter. But the current "bargaining for concessions" approach bothers me, and I'd love to find some way to change that mindset. I thought this might help.

Comments

Incorporating (Some) Unilateral Free Trade into the Trading System

That's the title of a short essay of mine in the Virginia Journal of International Law's online edition. Here's the main proposal:

... I thus propose an approach that I call "unilateral
reciprocal binding trade liberalization." The basic idea is that unilateral liberalization by one member
would lead to reciprocal liberalization from other members. The initial
liberalization is undertaken unilaterally, and would then be part of the
country's binding free trade promises. Other countries would then be required
to reciprocate with new free trade commitments of their own. In other words,
WTO Members would agree to cut their tariffs and other designated trade restrictions
whenever another Member makes unilateral cuts.

I will briefly sketch out the contours of this approach
here, but clearly further development is required if this proposal were to be
put into practice. In order to administer this system, a neutral review
mechanism, along the lines of the WTO's Trade Policy Review Mechanism, would be
set up to evaluate the extent of the unilateral cuts and quantify the matching
cuts that would be required in response. This mechanism would review existing
protection and government support, in order to determine the corresponding
liberalization to be offered in response to the initial liberalization. The
mechanism would be overseen by a group of outside (i.e., non-governmental)
experts.

In terms of the specific responding cuts to be made, only
those who benefit from the unilateral cuts would be required to make their own
cuts. When a government makes its initial unilateral cuts, it could request
which cuts it would like other governments to make in response. Ultimately, however,
the corresponding liberalization is each government’s choice. Its decision
would be made in conjunction with the neutral oversight mechanism.

More generally, I don't expect governments to adopt this approach any time soon, or ever for that matter. But the current "bargaining for concessions" approach bothers me, and I'd love to find some way to change that mindset. I thought this might help.